How to create a solid ecommerce business plan (+ Free template)

eCommerce is a powerful, high-income business model, offering massive profit margins. However, a lot of ecommerce businesses fail. According to founders, 9 out of 10 of these failures come down to one thing: poor business planning.

That is why the single most critical asset for any digital startup is an ecommerce business plan. A solid plan helps ecommerce businesses stay focused, avoid mistakes, and grow faster than those without one.

This guide walks you through the process of creating an ecommerce business plan, along with a ready-to-use template to get you started.

What are the components of an ecommerce business plan?

Creating a solid ecommerce business plan begins with understanding its anatomy, or the components included. This will help you identify what exactly is needed for creating the plan.

Key elements of an ecommerce business plan:

• Executive summary

• Business overview

• Market research & analysis

• Business model

• Product strategy

• Branding & unique selling proposition (USP)

• Marketing & sales strategy

• Online store

• Operations plan

• Financial plan

How to write an ecommerce business plan

To create a business plan, follow the step-by-step guide below, starting from the executive summary to the financial plan. You can adjust your plan to be detailed or brief based on your ecommerce business goals.

For example, if you are aiming to attract investors, a detailed business plan is ideal. Or, if you just want to provide direction for you and your team, a lean version is sufficient to keep everyone aligned.

Here are the steps to create an ecommerce business plan:

1. Define your ecommerce business overview

2. Conduct ecommerce market research and competitor analysis

3. Select the optimal ecommerce business model

4. Develop a product/service strategy for your online store

5. Define your branding elements and unique selling propositions (USPs)

6. Outline your marketing and sales strategy

7. Choose your ecommerce platform and online store setup

8. Detail your operations and logistics plan

9. Create a detailed financial plan

10. Complete the executive summary as the last step

Step 1: Define your ecommerce business overview

The primary goal of your business overview is to give a bird's-eye view of your business, brand name, the story behind your business, and where you operate.

It should serve as the elevator pitch for your business and also include information on your management team, ecommerce business structure, and legal setup.

Step 2: Conduct ecommerce market research and competitor analysis

To do proper market research, start by gathering data using primary and secondary research. Through your research, you should be able to gather the following insights:

• Industry overview

• Target market

• Customer persona

• Pain points

• Buying behavior

• Market gaps & opportunities

Another important step in conducting market research is estimating your market potential. You can do this using three key metrics: TAM, SAM, and SOM.

TAM - Total addressable market

TAM represents the entire market demand for your product or service if you could reach 100% of the market. It answers the question: “How big is the total opportunity?”

SAM - Serviceable available market

SAM is the specific segment of the TAM that your business can realistically serve based on your niche, product category, and region. It answers: “Which part of the market can I actually target?”

SOM - Serviceable obtainable market

SOM is the portion of the SAM that you can realistically capture, considering your marketing budget, competition, and operational capacity. It answers: “What market share can I realistically win?”

Next, do competitor research by identifying your competitors and analyzing them using the SWOT framework.

This approach helps you understand who you are competing against and uncovers opportunities to differentiate your brand.

Step 3: Select the optimal ecommerce business model

Your business model defines the core functions like how you operate, how you will earn, who you target, and how you're positioned in the market.

Based on your target audience, audience behavior, nature of product/service, and operations, you can choose your business model. A simple method to choose the right business model is to look at your competitors and what they follow.

There are different business models to choose from, namely:

• B2B - Business to business

• B2C - Business to customer

• D2C - Direct to customer

• B2G - Business to government

• C2B - Customer to government

• C2C - Customer to customer

• C2G - Customer to government

Step 4: Develop a product/service strategy for your online store

Your product/service strategy outlines a high-level plan detailing what you sell and how you are going to bring it to the market. This includes information about key features, categories, sourcing methods, and production cycle.

Another important aspect to include here is the pricing strategy. Your pricing strategy should include how you set your prices and the factors that influence them.

Pricing approaches differ between products and services. Before finalizing your prices, it is essential to understand those distinctions.

Step 5: Define your branding elements and unique selling propositions (USPs)

For any business, their branding and unique selling propositions (USPs) are what make their product/service irresistible to a customer. Together, these lay the foundation for advertising and marketing.

On top of that, if your ecommerce branding and USPs are strong, that translates to less friction in sales and shorter sales cycles.

In your online business plan, the branding elements should cover your core promises, identity, visual details, and voice. Your USPs should include three to five points on how your product/service differentiates from the rest.

Step 6: Outline your marketing and sales strategy

Next, you need to set the foundation of your ecommerce marketing strategy by outlining how you will drive traffic, generate demand, and make consistent sales. Specify whether you will use organic channels, paid channels, or a mix of both.

• Organic marketing: SEO, content marketing, social media, email newsletters, and community engagement

• Paid marketing: Social media ads, Google Ads, and influencer partnerships

Include a surface-level ecommerce marketing plan for the activities you intend to carry out for each channel. Also, mention the budget allocations and the overall goals for your initiatives.

Pro tip: A strategic marketing plan for ecommerce startups is to use a combination of both organic and paid marketing in the beginning to ensure both short-term momentum and long-term sustainable growth.

Step 7: Choose your ecommerce platform and online store setup

The most significant part of your ecommerce business plan is outlining the key information about your online store and its setup. First, include which ecommerce platform you have chosen and justify why it is the best fit.

Next, mention your domain name and hosting provider if your ecommerce platform requires external hosting.

Following these, outline your online store's structure, specifying the categories, pages, navigation menu, and checkout.

You should also list the essential integrations you plan to use for functions like payments, shipping, accounting, analytics, customer support, and marketing.

Finally, conclude this section with a brief launch timeline that shows when your store will go live.

Step 8: Detail your operations and logistics plan

Among the last few sections of your ecommerce business roadmap is where you'll discuss your operations and logistics plan. This will explain how your ecommerce business will run smoothly on a day-to-day basis.

Here, you need to include three main parts: inventory management, supplier relationships, and shipping partners.

1. Inventory management: Show how you maintain product availability and control operational costs.

• Where and how inventory will be stored

• Stocking strategy (JIT, safety stock, minimum order quantity, etc.)

• SKU organization and cataloging system

• Reorder points and replenishment frequency

2. Supplier relationships: Explain how you will source your products and maintain strong relationships with suppliers.

• Suppliers or manufacturers

• Contract terms

• Minimum order quantities (MOQs)

• Lead times

3. Shipping and fulfillment partners: Describe how products will reach customers efficiently and reliably.

• Shipping and courier partners

• Delivery zones (local, domestic, international)

• Shipping strategy (free shipping, flat rate, tiered, etc.)

• Returns & reverse logistics process

• Tracking and customer communication tools

• Expected delivery timelines

Step 9: Create a detailed financial plan

The final section of your ecommerce business plan is your financial outline, which shows your profitability and future projections.

Summarize your projected revenue and list all operating expenses. Next, create a realistic sales forecast by estimating your monthly traffic, possible conversion rates, and attainable average order value.

You can even include a break-even analysis in your financial plan for your online store.

Break-even analysis

A break-even analysis tells you how many units you need to sell or how much revenue you must generate to start making a profit. By calculating a break-even analysis, you will figure out the minimum performance your store must reach to remain financially healthy.

Break-even analysis formula

Pro tip: If you want a quicker method to calculate your break-even analysis, use this calculator provided by the US Small Business Administration.

Step 10: Complete the executive summary as the last step

An executive summary is a concentrated synopsis of the entire ecommerce business plan that captures the key points of each section. This is the first part of the plan and must be able to stand as a clear, independent document.

It is always advised to write the executive summary last. Writing it first might lead to inaccuracies or vague statements, as you will not have your final, calculated figures or refined ecommerce business strategies.

An ecommerce plan's executive summary should include:

• Business summary

• Mission + vision

• Product/service overview

• Problem + solution

• Value proposition

• Business model

• Financial projection

• Legal setup

• Funding

eCommerce business plan template

Here is a ready-to-use business plan template, put together based on the aforementioned steps for creating a business plan for ecommerce startups.

All you need to do is download the business plan template and enter the required details in the given fields.

Ecommerce business plan template

What to do after creating an ecommerce business plan

Once you have created a solid business plan for your ecommerce startup, the next step is to execute it. You can begin by validating your business idea and securing the necessary funding.

Then, set up your legal structure, including all the required state, local, and federal permits, and create a dedicated business bank account.

Finally, create your online store, which will serve as the primary channel for generating sales, showcasing your brand, and managing customer relationships.